I am pleased to announce that the gross discretionary social fund budget for 2012-13 will be £703.4 million.

With the net funding available, I have been able to allocate a gross national social fund loans budget of £561.4 million and a national community care grants budget of £141 million from 1 April 2012.

To provide help to area budgets facing unexpected and unplanned expenditure I will retain centrally £1 million as a contingency reserve.

I will allocate a gross national social fund loans budget in line with the provisions in the Welfare Reform Act 2007. The aim is to control and manage the national allocation while providing consistency of outcomes for budgeting loan applicants wherever they live. All loans budget expenditure will be made from the gross national loans budget of £561.4 million.

Following a review in 2011 into the funding allocations methodology, allocations to social fund budget areas have been adjusted to achieve a fairer distribution of the £141 million national budget between areas and to move to the optimal funding position for the new locally based service from 2013.

Details of individual community care grant allocations are contained within an explanatory note that I will place in the House Library today.

Background Note about t he Discretionary Social Fund Budget

The discretionary social fund budget is cash-limited. Funding for community care grants is allocated to each budget area for management by social fund benefit delivery centres on 1 April each year. The gross discretionary social fund budget allocated for 2012-13 is £703.4 million. This is made up of: